Venture Capital

Intel investing $2B in Sprint/Clearwire - Rumor Mill Roundup

Phil Goldstein — Tue, 02 Dec 2008 15:55:54 -0500

Verdict: RIGHT

Why it went right: Initially, the spinoff of Sprint's WiMAX business, Xohm, and the combination with Clearwire, was an interesting curiosity. It was rumored that Intel Capital would provide $2 billion in backing, giving solid support for WiMAX as a mobile broadband standard. As it turned out, the deal to create the "new" Clearwire was a lot more complex and substantial than was initially thought. The final deal included $3.2 billion in investments from Intel, Google, Comcast, Time Warner Cable, Bright House Networks and Trilogy Equity Partners. On Nov. 4, the FCC gave regulatory approval for the deal. On Nov. 20, Clearwire shareholders gave their assent, and on Dec. 1, Clearwire CEO Ben Wolff said that the venture's new name would be "Clear."

For more read - Intel investing $2B in Sprint/Clearwire

Mobile satellite is making a comeback

Lynnette Luna — Sun, 30 Nov 2008 23:53:37 -0500

Remember that series of financial disasters in the late 1990s for mobile satellite services (MSS) companies such as Iridium, Globalstar and ICO? Ten years later, and the industry appears to be headed for a resurrection, enabled by relaxed regulations, business plans, new satellites capable of offering broadband applications and a remedy to those clunky handsets that played a large role in the industry's downfall.

Several MSS companies are working to make MSS a consumer product in the next two years, and most are looking to the mobile broadband industry as a significant part of their businesses as the FCC now allows operators to utilize terrestrial partners.

And the crux of their plans is an announcement that flew somewhat under the radar in September. Qualcomm made a deal with ICO and Mobile Satellite Ventures (MSV) to put satellite and cellular phone technology into baseband chips embedded in multi-mode phones. This will both allow a wider consumer market to access satellite connectivity and enable handset makers to develop EVDO, WCDMA and LTE phones that are satellite-capable.

"That means that satellite-enabled chipsets are going to be available at no incremental cost," said Chris Gates, vice president of strategy with MSV. "The power of this can't be overstated. It means that satellite services can move cost effectively into the mass market with no impact on device form factor."

ICO has deployed a GEO satellite designed to deliver a satellite-hybrid terrestrial network using mobile TV technology DVB-SH. The company has begun market trials in Las Vegas and Raleigh-Durham with Clearwire to focus on increasing the value and cost effectiveness of delivering advanced interactive mobile video services.

"The amount of capacity that these networks lose by offering video over terrestrial networks is immense," said ICO CEO Tim Bryan. "Even if you have LTE or WiMAX it doesn't matter. There is a lot of capacity that is lost. It would be much more efficient to offer mobile video on a nationwide basis by offloading it to satellite and use the other capacity for data and other services."

MSS could also provide an avenue for terrestrial wireless broadband providers to expand their coverage. Globalstar recently won approval from the FCC to incorporate WiMAX in the ancillary terrestrial component (ATC) level with the help of terrestrial partner Open Range Communication. The two will offer WiMAX to more than 500 rural communities--with the help of a $267 million loan from the Department of Agriculture's Rural Development Utilities Program. Globalstar said it will be looking for other partners too.

Mobile Satellite Ventures (MSV), which already offers satellite telephony service to niche markets, plans to launch two new high-powered satellites capable of high-speed data with service available in 2010, but hasn't announced any terrestrial partners yet. According to Chris Gates, vice president of strategy with MSV, the satellite provider offers a significant advantage for terrestrial operators wanting to extend coverage and offload data traffic because it has access to a large swathe of spectrum via an agreement with Inmarsat, which gives it the ability to access up to 46 megahertz of spectrum, 40 megahertz for ATC services and 6 megahertz for MSS only services.

"That's an extraordinary amount of spectrum, about the size of the 700 MHz auction," Gates said. "We think there will be huge demand for additional spectrum as data becomes more and more important, and we're available in the near term."

In addition, MSV is targeting a host of markets: government, enterprise, telematics and mass consumer.

But it seems like the biggest hurdle to getting the message across that satellite operators make good partners for terrestrial network operators is the stigma associated with the failed business plans of the past. Bryan said that stigma is the reason ICO has been busy building its satellite capabilities and demonstrating what its services can do.

2009 should be an interesting year for the satellite industry. We could see some new and interesting partnerships--perhaps even one that creates a new nationwide 4G wireless network in the U.S. --Lynnette

Clearwire's stock in the pits

Lynnette Luna — Tue, 22 Jul 2008 18:57:34 -0400

Clearwire's stock hit a 52-week low on the Nasdaq Tuesday, dropping as low as $8.98 a share. The operator, which is planning to merge with Sprint Nextel's WiMAX business with the help of billions from investment partners Intel, Google and cable operators Comcast, Time Warner and Bright House, has seen its shares fall steadily since early June. But the stock fell below $10 at the end of last week. The shares remain in the pits despite recent upgrades from the likes of RBC Capital markets, which initiated coverage with an "outperform" rating and a target price of $17. Citigroup also recently upgraded the operator's target price to $13 a share.

For more:
- see Unstrung

Related stories:
Introducing the "new" Clearwire. Clearwire story
New Sprint-Clearwire deal a shot in the arm for mobile WiMAX. Sprint-Clearwire editorial

Survey: Wireless apps to receive attention from VCs

Lynnette Luna — Tue, 17 Jun 2008 16:44:45 -0400

New figures from KPMG predict that venture capitalists are poised to throw money into the mobile and online entertainment space during the next two years. In a poll of 300 VCs, corporate executives and bankers, 52 percent predicted investments in digital content creation would significantly increase. Wireless applications are expected to receive the most investment dollars, according to 31 percent of the respondents. 26 percent said technology enablers will see the most funding, while 20 percent predicted social media services will receive the most funding. Article

Qualcomm invests in femtocell firm

Sue Marek — Wed, 21 May 2008 11:32:28 -0400

Femtocell and picocell maker ip.access received a financial boost from Qualcomm today. The company joined existing investors Cisco, Intel Capital, ADC, Motorola Ventures, Scottish Equity Partners, Rothschild Gestion and Amadeus Capital Partners to fund ip.access' Oyster 3G femtocell system, which uses the residential broadband connection to deliver a 3G signal in the home. ip.access is rumored to have inked a femtocell deal with AT&T.

Ovum analyst Jeremy Green says that the money Qualcomm is investing in ip.access is not as important as the relationships and influence it yields for the firm. Green adds that while Ovum is still somewhat skeptical about the femtocell business case, Qualcomm's decision to invest in ip.access gives the femtocell proposition more credibility.

This is the second big European announcement from Qualcomm this week. On Monday, the firm announced that it was purchasing a 40 MHz chunk of L-band spectrum, prompting speculation that it was planning to use it to deliver mobile TV service.

For more:
- see this press release

Related stories:
Qualcomm wins U.K. spectrum but coy about plans. See this story about Qualcomm's spectrum win.
T-Mobile invests in femtocell maker. Read this T-Mobile femtocell article.
Rumor: ip.access wins femtocell deal with AT&T. See this article on ip.access and AT&T.

AT&T to launch 3G BlackBerry Bold

Brian Dolan — Mon, 12 May 2008 11:41:42 -0400

Research In Motion debuted its latest BlackBerry, called Bold, which runs on HSDPA and comes with GPS and 802.11a/b/g WiFi. The device offers increased processing power and features a silver rim, which the Wall Street Journal pegs as a nod to its budding competitor the Apple iPhone.

The BlackBerry Bold, however, includes another enhancement that works toward Apple's favor: an easier syncing capability with Apple's iTunes. RIM's co-CEO Jim Balsillie explained the syncing feature as a natural progression: "We don't view it as a competition thing, we view it as a natural sync to an application that you use in your life."

While neither AT&T nor RIM announced a specific launch date for the BlackBerry Bold, it will hit shelves this summer around the same time that Apple is expected to launch its 3G iPhone. As part of the launch for Bold, RIM is teaming up with Thomson Reuters and the Royal Bank of Canada to form a $150 million venture capital fund to encourage applications for the BlackBerry platform.

For more on the Bold:
- read this press release
- read this WSJ article (sub. req.)
- check out this article on the BlackBerry VC fund over at FierceMobileContent

Bye Bye Xohm

Wed, 07 May 2008 06:59:59 -0400

Bye Bye Xohm

Less than a year after Xohm made its big brand debut at Sprint's Technology Conference, the cryptic name for Sprint's WiMAX network is already dead. Thanks to this morning's big announcement about Sprint and Clearwire combining their WiMAX businesses, Xohm will be relegated to the wireless brand graveyard where it will rest in peace alongside so many other dead brands--Cingular, AirTouch, VoiceStream--to name a few.

Of course, the amazing thing about Xohm is that it was a brand that never even had a product. Just as we were getting accustomed to its weird new-age sound (rhymes with Zone) it has been replaced. Consumers really never had a chance to get familiar with Xohm, it died before it made its commercial debut. Ã‚Â

Thanks to today's merger Xohm will now be the new Clearwire, a much easier to pronounce name that already has some consumer awareness in markets where Clearwire has launched its WiMAX services.

Of course today's news is much bigger than just a brand name. It's about the formation of a new company that will likely revitalize the entire mobile WiMAX ecosystem. To recap: Sprint is merging its Xohm Business unit with Clearwire and heavyweights Intel, Google, Comcast, Time Warner Cable and Bright House Networks and Trilogy Equity Partners will invest $3.2 billion in the combined company.

Of course, I'm skeptical whether this hodgepodge of powerful players will be able to pull off such a complex deal. Leadership will be incredibly important. Wireless legend Craig McCaw will be the chairman of the board and he has assembled an impressive group of board members including Brian Roberts of Comcast, Glenn Britt of Time Warner, John Stanton of Trilogy Equity Partners and Dan Hesse of Sprint. It appears to me that McCaw has brought together some of his trusted players from his early days in wireless to be part of this new venture. Stanton (the former head of Western Wireless) and Hesse are old-time McCaw Cellular/AT&T Wireless guys who were known for their innovation and perseverance. Those are two characteristics that this new venture will certainly need in the months ahead. -Sue

Introducing the "new" Clearwire

Wed, 07 May 2008 06:59:58 -0400

After months of rumors and speculation, the deal that the mobile WiMAX industry has been hoping for finally became a reality. This morning Sprint and Clearwire announced that they will be combining their WiMAX businesses and creating a new company that will include a $3.2 billion investment from Intel, Google, Comcast, Time Warner Cable, Bright House Networks and Trilogy Equity Partners. The deal is complex, so here's a breakdown of the key elements:

The "new" Clearwire: The new company will be named Clearwire. It will include Sprint's Xohm unit. Sprint will contribute its 2.5 GHz spectrum to the new Clearwire in exchange for an ownership stake in the new company. Clearwire CEO Ben Wolff will be the CEO of the new Clearwire. Barry West, Sprint's CTO and Xohm business unit leader will be the president. The new company will include staff from both the existing Clearwire and Sprint Xohm business unit. Headquarters will be in Kirkland, Wash., with significant presence and R&D in Herndon, Va.

MVNO deals: Comcast, Time Warner, Bright House and Clearwire will operate as MVNOs selling Sprint 3G services. But unlike the former Pivot JV, these players will sell the 3G wireless services using their own brand names. Once the 4G WiMAX network is built, Comcast, Time Warner, Bright House and Sprint will be MVNOs on the Clearwire network.

Sprint's role: Sprint won't be involved in the day-to-day operations of Clearwire but as the largest shareholder it will have input on the portfolio and the go-to-market strategy.

Intel: Intel will work with manufacturers to embed WiMAX chips into laptops and devices. It will also have the option to enter into a 3G or 4G wholesale agreement with Clearwire and Sprint if it wants too.

Google: Google will partner with Clearwire on an open Internet business model. Clearwire will support the Android operating system. In addition, Google will be the default provider of Web and local search on Sprint's network and Sprint will preload several Google services including Google Maps for mobile, Gmail and YouTube. Like Intel, Google will have the option to have a 3G or 4G wholesale agreement with Clearwire or Sprint if it wants too.

For more details
- see this press release.

Click here to see a timeline of the Sprint/Clearwire WiMAX deal.

Click here to see a chart depicting Clearwire's new spectrum position.

Essar acquires stake in Obopay

Tue, 29 Apr 2008 06:59:56 -0400

Shortly after closing a $20 million fourth round of venture capital funding, Obopay has announced that India telecom Essar has acquired a strategic stake in the company for an undisclosed amount.

"Obopay has introduced significant mobile payment innovations in the U.S. and recently in India as well. We look forward to working with Obopay to build upon the integration of the mobile phone into the lives of consumers worldwide," Essar Senior Vice-President (Business Development) K.B. Rajendran said in a statement. Rajendran joined the Obopay board of directors as part of the deal.

For more on the deal:
- read this article from Economic Times

VC: Vlingo get 2nd round investment

Thu, 10 Apr 2008 06:59:52 -0400

VENTURE CAPITAL
COMPANY	AMOUNT/ROUND	LEAD INVESTORS	DESCRIPTION
Vlingo Cambridge, MA	$20M second	Yahoo	Vlingo makes voice recognition applications for the mobile platform.
SiBeam Sunnyvale, CA	$40M third	New Enterprise Associates	SiBeam is looking to win the wireless HD standard war.
Aperto Milpitas, CA	$20M N/A	Quicksilver Ventures	Aperto makes WiMAX base stations and subscriber units.

ALSO NOTED: No AT&T-CNN mobile TV exclusive?; Adobe merges units; and much more...

Tue, 08 Apr 2008 06:59:50 -0400

> Adobe merges mobile and platform units. Article

> MobiVentures acquiring Purepromoter. Article

> Gumiyo, HomeNet drive mobile web for car dealers. Article

> Intel Capital unveils another China fund with $500 million in it. Article

And Finally... Former professor invents Braille handset with vibrations. Article

ALSO NOTED: Fixing mobile music; iPhone traffic flattens; and much more...

Tue, 18 Mar 2008 07:59:50 -0400

> How do we revitalize mobile music? Article

> LiveWire buys Groove Mobile for $14.5 million. Article

> Report: iPhone traffic flattened last month. Article

> SendMe snags $15 million in venture capital. Article

And Finally... German driver says he was just using his phone to keep his ear warm. The court believed him since his itemized bill showed no phone call around the time he was issued a ticket. Article

Sprint, it's time to take the money

Mon, 10 Mar 2008 07:59:59 -0400

Sprint, it's time to take the money

The rumors are rife over acquisition and spin-off scenarios for troubled Sprint. Deutsche Telekom might make a play for Sprint, Sprint may spin off Nextel and Verizon might try to buy Sprint.

The bottom line is: There is no easy fix for Sprint. CEO Dan Hesse recently admitted that the problems facing the operator are more difficult than he anticipated. He's already done a lot internally, cutting 4,000 jobs, reducing the number of distribution points and consolidating the the company's headquarters. Now it's time to make the drastic moves, and one has to be looking for outside investments.

Back in December, Sprint reportedly wouldn't even entertain a $5-billion investment from SK Telecom and PE firm Providence Equity Partners that included installing Sprint's former chairman Tim Donahue as CEO of the company (I have a feeling it was installing Donahue that was the sticking point since former Sprint and Nextel executives love to point the finger at who messed this acquisition up). Now it's time to start courting the PE firms and foreign investors who want a piece of the U.S. wireless market.

Many private equity firms have funds to spend, and they want to spend it in the telecom industry these days. We've seen some high-profile private equity moves in telecom recently, including the buyouts ofÃ‚Â Covad Communications, Bell CanadaÃ‚Â and Alltel Wireless.Ã‚Â

Analysts predict that with the economy teetering, PE firms will look to telecom carriers and vendors who have high cash flow and manageable debt as new investment opportunities. The beauty of privately led leveraged buyouts is that investment groups have the ability to reshape the business in a manner that previous management and relationships could not and without investors breathing down their necks. These companies have the financial capability to buy other companies that will complement some of these businesses. They can sell non-core businesses and add to the core capabilities. The net result can be a high-value company. -Lynnette

VC: T-Mobile invests in femtocells

Thu, 06 Mar 2008 06:59:52 -0500

Mobile ads and femtocells.

VENTURE CAPITAL
COMPANY	AMOUNT/ROUND	LEAD INVESTORS	DESCRIPTION
Ubiquisys Swindon, UK	$25M N/A	T-Mobile Venture Fund	Ubiquisys makes femtocells. T-Mobile Venture fund contributed to the $25 million round.
Tzero Sunnyvale, CA	$18M third	CID Group	Tzero makes ultra-wideband technology and wireless video products.
Rapid Mobile Scotland	$4M second	New Enterprise Associates	Rapid develops mobile advertising and mobile application positioning software.

T-Mobile's VC arm invests in femtocells

Mon, 03 Mar 2008 06:59:58 -0500

T-Mobile's venture arm has invested an undisclosed amount into the U.K.-based femtocell maker, Ubiquisys. Google, Accel Partners, Atlas Venture and Advent Venture Partners had previously invested in Ubiquisys. Cisco and Intel recently invested in femtocell company ip.access and Qualcomm has put money into Airvana.

T-Mobile said it plans to test Ubiquisys' femtocell technology in trials in Germany, the Netherlands and the U.K. in the coming months. Meanwhile, its U.S. subsidiary is using WiFi hotspots in the home as an alternative to a femtocell solution to improve coverage in the home.

For more on T-Mobile's investment:
- read this article from the Guardian

Phones4u buys Dial-a-Phone for $18M

Wed, 20 Feb 2008 06:59:55 -0500

UK-based online retailer Phones4u has bought its rival Dial-a-Phone for $18 million. Dial-a-Phone sold about 121,000 mobile phone contracts last year and employs a staff of about 300. Phones4u was, until recently, part of the Caudwell group, but was acquired by Providence Equity Partners in 2006.

Phones4u CEO Tim Whiting explained the synergies between the two companies: "Dial-a-Phone's strong brand and high level of expertise in the direct market are a perfect complement to Phones4u's brand and strength on the High Street."

For more on the online retail deal:
- read this article from Cellular-News

Rumor Mill: Intel investing $2B in Sprint/Clearwire

Fri, 15 Feb 2008 06:59:58 -0500

Rumors are circulating once again that Sprint Nextel will spin off its Xohm WiMAX broadband unit and form a joint venture with Clearwire. The Street.com is reporting that the deal between the two firms will include a $2 billion investment from Intel Capital.

If this rumored deal actually goes through, it will give a much-needed vote of confidence to WiMAX. Many companies at Mobile World Congress in Barcelona said much of WiMAX's future was resting on Sprint's Xohm business. Without Xohm, mobile WiMAX may not be anything other than a niche play.

Find out the latest on Xohm at the FierceWireless co-located event "4G and Beyond" on April 2 at CTIA Wireless 2008. Barry West, CTO of Sprint and head of the Xohm unit will be a keynote speaker and will provide a status update on Xohm. Here's a link to the agenda.

For more on Sprint and Clearwire:
- See this Street.com report

Related stories:
FierceWireless 2008 predictions "Sprint and Clearwire will merge their WiMAX networks." Story
Analyst: Sprint and Clearwire to reunite? Story

Amp'd Mobile tries to recoup funds

Fri, 08 Feb 2008 06:59:57 -0500

Remember when Amp'd Mobile was an MVNO with hundreds of millions of dollars in VC? After more than six months since it sold its subscribers to Prexar Mobile, the company is now looking to recover funds from at least 20 entities. Former CEO Peter Adderton is one target: Amp'd wants $1.15 million back from the executive because he "refused to perform certain aspects of his employment" and "threatened to take actions that would damage" the company. Amp'd is also looking to recoup funds from Merrill Lynch, GE Capital, Latham & Watkins, MTV Networks on Campus, Playboy and others.

Amp'd has also hired William Morris Agency, Quinn Pacific and Mosaic Capital to shop its assets, which include the company's brand, trademarks, content studio and content like "Lil' Bush."

For more on Amp'd's latest bankruptcy challenge:
- read this article from The Deal

VC: eBuddy snags $9.5M

Thu, 07 Feb 2008 06:59:52 -0500

Mobile IM, smartphones and advertising raise the big rounds this week.

VENTURE CAPITAL
COMPANY	AMOUNT/ROUND	LEAD INVESTORS	DESCRIPTION
Numobiq Pleasanton, CA	$4.5M first	Benchmark	Numobiq turns regular handsets into smartphones with its software.
eBuddy Amsterdam	$9.5M second	Prime Technology	eBuddy makes mobile IM apps.
Ringleader New York, New York	$6M first	W2 Group	Ringleader runs a mobile advertising network.

Back to Barcelona: New name, more innovation

Wed, 06 Feb 2008 12:06:47 -0500

When I first started attending the Mobile World Congress (then known as 3GSM World Congress) back in 2002 it was strictly a GSM technology event and much of the program was geared toward a European audience.

Today, 3GSM has been rebranded Mobile World Congress and while GSM still dominates the show, other technology options (such as WiMAX) will be on display and U.S. companies will be prevalent at the event as speakers, exhibitors and attendees.

The GSM Association, which hosts the event, expects this year's show to attract about 53,000 attendees (roughly the same as 2007). "This size and capacity is right for Barcelona. We aren't trying to grow the show. We want to keep it a business-to-business show," says GSMA spokesman David Pringle.

But that doesn't mean there won't be new additions to the conference. I'm particularly intrigued by the Mobile Innovation Marketplace-a two-day event in which 25 pre-selected startups are going to give brief demonstrations of their products to an audience of operators and venture capitalists. I know it's tough for small firms to get visibility with operators and this event gives them the perfect venue to make those contacts and get the necessary traction in the market.

Pringle expects LTE (long-term evolution) to be a big topic at the show with many vendors demonstrating their LTE technology. He also believes that there will be lots of discussion on spectrum, particularly the 700 MHz and 800 MHz frequencies and what this means for wireless broadband.

On the practical side, expect to find even more taxicabs at your disposal. Pringle says that taxi drivers have received permission to work on their day off, making more cabs available for Mobile World Congress attendees.

In addition, expect the Fira to feel even bigger. Pringle says that for the first time Mobile World Congress will be using the entire convention center so convention-goers and exhibitors will have more "room to breathe."

The Fierce editorial team will be bringing you all the news from the Mobile World Congress. I'll be in Barcelona along with my colleagues Brian Dolan and Jason Ankeny. If you see us slogging through the teams of other attendees at the show, be sure to say hello. --Sue

- Click here for the rest of our conference coverageÃ‚Â